Posted by Webmaster on Apr 29, 2013 in Idea Cellular | Comments Off on Idea Cellular Expects Revenue Per Minute to be Flat

Idea Cellular Mgmt clarified that the overall RPM remained flat sequentially despite cutting free-mins mainly due to lower
proportion of higher RPM ILD minutes in 4Q. Idea believes the stricter subs acquisition norms by TRAI has discouraged multi-SIM usage and has led to incremental consumer spending in favour of existing SIM card (vs. buying a new SIM); this has also partially led to increase in MOU. The Mgmt does not expect any sharp increase in RPMs and believes that impact of tariff hikes will be gradual.

Idea has seen industry-wide discipline in subs acquisition costs and believes margin expansion will continue if acquisition costs remain in control. Idea stated that its utilization levels are still low and may also add to margin expansion as usage increases.

On Roaming Charges Abolition
Idea stated that if the domestic roaming charges are abolished (which are c.4% of total revenues), tariff balancing may take
place to compensate the loss.

2G & 3G Data
Mgmt indicated that data ARPU is still very low at Rs55 (vs. comparable markets) and it expects continued increase in data usage. Mgmt believes that increase in data usage will be driven more by reduction in prices of data-enabled devices than lowering of data tariffs.